This is Bloomberg Crypto, a daily Bloomberg I Heard podcast, and I'm Stacy Marie Ishmael, Managing editor of Crypto for Bloomberg News. It's Tuesday, November one. About a year ago, Nigeria introduced a digital version of its official currency, the naira. The introduction of the so called e Nira was partly a response to concerns that the rising popularity of crypto in the country was going to threaten the banking system.
Now there are a few countries experimenting with their own versions of digital money, including the Central African Republic, which we've talked about in the show, China, Jamaica, the Bahamas, and various islands in the Eastern Caribbean. Other countries, including where I am in the United States, are in the studying and thinking deep thoughts about feasibility phase of things.
So how's it going for Nigeria and then Era, let's ask Bloomberg reporter Ruth Ola Rumby is the one year and only zero points five percent of the population is just in um either nire and Bloomberg Nigeria Bureau chief Anthony Osai Brown Usability is key, all right? Now, the usability argument is very little for its occurrencies. One of the topics that we cover a lot on this podcast is obviously digital assets, and you know, within digital assets
certainly crypto cryptos. In the name that say is the Bloomberg Crypto Podcast. But we've also talked about something called central bank digital currencies, which is the idea of governments themselves issuing a kind of digital cash. Can you all talk a little bit more about what the Nigerian ex
periament with digital money has been like. Okay, so the Nigerent Central Bank launched a data currency about a year ago when the central bank decided that he needed a form of an alternity to the nira um and that was interestingly, after asking financial institutions not to honor crypto transactions, he felt he needed an alternative to crypto transactions, so it launched the inn Era to sort of replace crypto.
And so that's what the central bank has been doing for some time now, and interestingly, the currency has not picked up, possibly as much as the central bank bop it would. Since then, Yeah, they've they've had about a million people downloading the inn Era. What percentage of the population is actually using this thing, it's about zero points. Five percent of the population is currently used in the admira.
The right of adoption has been slow, and that's messing because people are not either not trust in the government in a given its stance against cryptocurrency, and mostly because many people also don't know about what's innira is. So you've got a country with a population of more than
say two hundred million. The government didn't exactly ban crypto, but the central Bank made it pretty clear that it didn't approve and issued some sternly worded letters to other financial institutions, and they come out with this inn era and you know, according to your reporting, one of the reasons for that was trying to encourage people who live in Nigeria but didn't have a bank account. Is that correct, Yeah,
that's relatively correct. The innigent population about five per center for others have no bank account, and so the central Bank talked it to be the innira. Well, if five percent people of the people don't have a bank account, but we have at least one hundred and fifty million mobile subscribers, at least it's one percent of the population
have the phones. So the central Bank felt the phone could be a good leverage to drive financial inclusion by creating an inn era which can you can basically use your phone to assess and pay for services through that platform. So that that was the idea to increase financial inclusion by leverage and mobile telect communications, but it doesn't sound like that's what's happening. There's been a lot of challenges.
Awareness is there, and as Ruth said, there's also some level of suspicion, some level of lack of trust in the Central Bank. And then physically affordability. Affordability in the sense that yeah, that everybody uses the phone, but not necessary everybody that uses the phone can afford to load the phone with in era, So that has been also a challenge and a lot of people are just like indifferent about the in era. Usability is a big issue. Most people who have phones are already used to using
their banking apps and alternatives from the banking sector. And also if you consider that internet pronatortion in Nigeria is less than and you need internet to use the INNIRA, so that could also be a reason for why adoption is very low in Nigeria. Ruth, what has the government
been do going to try to drive adoption? So currently the government is trying to target the transportation sector and specifically the tricycle operators, and my guess is that the government is start getting them because they're everywhere, both in the rural area and the urban area. I live in a Punja and the transple is one of the biggest means of transportation here in the capital city. So I'm gonna ask a like a completely. I have clearly never
been to Nigeria. Question, when I hear tricycle, I think of like bike with three wheels. When you say tricycle, what do you mean, Yes, bike with three wheels, think Hollywood movies. I think India. You know Hollywood movies and if you go to any rural area in Nigeria you will find them. So it makes sense that this tricycles would be of Min's focus for driving adoption. I'm learning
so much right now. So you know, Anthony Ruth, you've both been reporting on nigeria financial system for a long time. You know, we have interviewed some folks who have written about what's been happening to the attempts by the Central African Republic to launch its own digital currency as well as you know, they've been trying to follow El Salvador
in adopting bitcoin. We've talked on this podcast about you know, the fact that lots of other countries are thinking about doing digital currencies of their own, with mostly mixed results, right Like, some of them, including the US, are like, ah, we're trying to figure this out. Some of them, like China, like we can make you use this. So there's there's a lot of range in terms of the success of adoption. With the latest attempts by the Nigerian government to drive
people to to use this an era. Are you seeing are you I need to see any results or is this still a case of like in a year from now, it's still going to be a tiny fraction of the population. That's that's difficult to say. The central bank is quite optimistic, um, but yeah, there's been It depends on what what happens
going forward. Would were likely to see. People have suggested that the government intervenes by for example, pain have salaries or salaries below a certain rage in in ira if the central if the government takes such an action, they were kind of like, we are likely to see high take oporate in the in era. So it depends on what actions the central bank or the government takes going forward to compel usage of the inn ira, and if
that happens, then we'll see a significant difference. But if that doesn't happen, then they're still going to be huge resistance in the tacoporate for the inerra. It also sounds you know, there's a quote in your story from one of the drivers of these motorized tricycles, which is, you know, why is the government asking us to collect in ira?
I thought the government said cryptocurrency is bad, and I thought that was so interesting because it's like, it can be hard to explain to somebody how this is different from them using bitcoin on their phones. How is the government trying to help people understand the difference? Is the government trying to help people understand the difference? The government has just said that this is different from cryptocurrency. That's it, So most people I can't I can't explain to you
how different this is to cryptocurrency. And you know, if the if the governments, that if the central that is introducing the innira is not communicating well with us telling us how different this is to uh to other forms of digital currency out there, that I think that's a
that's a problem. I would never describe myself as a copywriter, but I do think it's been helpful for me to think about the difference here as you know, like and there are gonna be people who are gonna write me angry emails about that feel free crypto at Bloomberg dot net.
But what I'm going to say is that, you know, like digital currencies like the Nira are like crypto issued by a government, right, whereas tokens like bitcoin, ether doage coin are things for which there is no central bank like entity someone described them, describe them as private currency,
private currencies, government currency, and the private currency indeed. And so you know, I think like these sorts of distinctions might not matter to the person on the other end of a transaction, but governments get really fussed about them because, you know, as you said at the beginning, one of the concerns that governments often have is the stability of
their own banking systems. And you know, various regulators around the world, not just in Nigeria, have definitely expressed concerns that cryptocurrencies could pose some kind of threat, real or perceived to the financial system. Yeah that like banks, commercial lenders, Yeah, I have been very slow in adopting in pushing creating awareness for the in era because there's no instensive for
them to do that. Cash taking on the act of the banks that put on in an inira wallets is not counted as cash on the books of the banks.
This is a really really important point, and I think it's something that a lot of people don't necessarily pay attention to, which is the banks themselves are not huge fans by default of this kind of digital money for the exact reason that you're describing, which is they don't necessarily have the ability to make money on digital money, right because it's like when you're you're borrowing, if you have one era, that's a claim directly on the Nigerian
Central Bank Central Bank, Yeah, exactly exactly, and not a claim on them. And meanwhile, they mobilize that deposit at the costom and so physically they are losing by you creating an nira and well it's on their account. We'll be right back with more from Bloomberg's Ruth all Around By and Anthony Osi Brown. You know, if you have somebody who's listening to this podcast and they're like, wow, this is interesting, I hadn't I never thought about that
this way? What is like one key thing for each of you you think somebody should really like take away
from you know you're reporting. I think the key thing is for me is the fact that this experiment UH needs some form of intervention to make it gain traction, and so far that intervention is not coming, and that until we get the intervention, the currency usage for EXAM in Nigeria is going to be a dream and their awareness is not just going to usability is key all right now, the usability argument is very little for the
data currency. So for anyone launching a data currency, you have to think of the usability question and answer it before you introduce it. Once you don't create that question, once you don't answer that question, they're most likely you're not like likely to make any got it and Ruth, what about you? For me? I would say that you also need to invest in educating the public what your product is about. Obviously, if you'll bring it out to
a product, you'll send a gap in the market. But if you're not educating the public the market, if you're not telling them why why they need to use this as well why it's good for them the rest of adoption of in Naira is going to do remain low. It's been one year and only zero points five percent of the population is using um in Nira. So if you're not giving out bangor campaigns, you're not telling people about it and why they need to use it. We
probably will come back next year and still talk about this. Well, you're welcome back on the podcast next year or any time before that. Thank you both, it's been a pleasure. Thank you, Thank you for having us. Thank you Ruth, and thank you Anthony for joining me today. You can find more of Anthony Osai Brown and Ruth olar Rumby's reporting on the Bloomberg Terminal on Bloomberg dot com or follow them on Twitter. Ruth is at olar room By that's O l U r O U n b I and Anthony is at O S A E B. On
the next episode of Bloomberg Crypto. Is Bitcoin boring? Now? That's the current meme slash complaint among a certain kind of crypto enthusiast, and it reflects the recent very tight trading range for the largest digital token. How are traders responding to Bitcoin's relative absence of volatility? We'll discuss tomorrow. This is Bloomberg Crypto, a daily podcast from Bloomberg and I Heart Radio. For more shows from I Heart Radio, visit the I Heart Radio app, Apple Podcasts, or wherever
you get your podcasts. Send us your comments, questions, or suggestion for the show to Crypto at Bloomberg dot net or find us on Twitter. We're at Crypto. The supervising producer of Bloomberg Crypto is Vicky Verglina. Our senior producer is Janet Babin. Our producers are Mohammed Faruk and Sharon Barriro. Our associate producers are Ty Butler and Moses on Them. Desta wonder At is our engineer. Original music by Leo Sidron. I'm Stacy Marie Schmal. We'll be back tomorrow